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Government streamlines procedures for business approval

Updated: Aug 20,2014 11:05 PM     China Daily

The central government made further strides on Aug 20 in streamlining administrative procedures to encourage the establishment of new companies and investment.

It is necessary to take “strong measures” to clear obstacles against streamlining administrative procedures and to make the market more free, the central government said in a circular issued after an executive meeting of the State Council.

The conference, presided over by Premier Li Keqiang, decided to cancel 68 administrative approvals and decentralize another 19 to local governments. This, according to the circular, will benefit companies and the market.

The central government said it is going to lower the threshold for entities such as for-profit health institutions and rest homes, so that they don’t have to wait until they go through all of the administrative approval steps conducted by various government departments before they can apply for a business license.

A health official in Beijing, who declined to be named, said that people need to get health department approval to run a business as a health institution.

Getting a business license issued by the industry and commerce authorities and forming a company first will allow such companies to conduct preparatory work, such as financing, while waiting for all of the administrative approvals needed to start a health business, the official said.

Zhan Zhongle, a law professor at Peking University, said the new measures show Beijing’s “strong determination” to switch the role of governments.

He noted that Li, at his first news conference after assuming office in March 2013, described efforts to streamline government functions as a “self-imposed revolution” that demands a conviction to “chop off one’s own arms”.

The government’s efforts to streamline administration in the past months have proved effective. Newly registered enterprises across the nation rose by 27.6 percent last year, while the share of private investment increased to 63 percent, according to official figures.

Also discussed at the meeting were future relief efforts for those affected by the magnitude-6.5 earthquake that rocked Yunnan province on Aug 3. About 230,000 people have been relocated to safer areas.

The conference also brought forth proposals to spur growth in China’s science and technology service industries.